Newcrest profit up on record Cadia result

Newcrest has more than doubled its first-half profit, buoyed by record gold and copper production at its Cadia operations.

Rashmi Ashok and Niyati Shetty

ReutersFebruary 14, 201910:52am

Australia's top gold miner Newcrest has more than doubled its first-half profit, buoyed by record gold and copper production at its Cadia operations.

First-half results were also boosted by a weakening of the Australian dollar, which helped control costs at its Australian operations, the company said.

Copper production during the first-half came in at 51.8 thousand tonnes, a jump of 33 per cent, while sales revenue rose less than 1 per cent to $1.73 billion for first-half of fiscal 2018, the company reported.

Underlying profit for the six months ended December 31 came in at $237 million, up from $116 million a year ago.

UBS had estimated net profit after tax of $223 million.

Gold production for the half-year climbed to 1.2 million ounces, about 6 per cent higher than last year, while all-in sustaining cost fell 13 per cent to $747 per ounce.

The company said it expects total capital expenditure for fiscal 2019 to be around the lower end of the forecast it issued last month of between $590 million and $690 million.

In December, the miner raised its holdings in Ecuador gold and copper developer SolGold Plc, in a move that strengthened its position as the biggest investor ahead of rival BHP Group.

Gold producers have been on a deal-making spree in a bid to boost their waning reserves amid higher bullion prices.

Newcrest is seen by analysts as the likely candidate to combine with a North American rival, following recent acquisitions by major mining companies Barrick Gold and Newmont Mining.

The company also announced an interim dividend of 7.5 cents per share, the same as last year.